As a professional accountant, you work tirelessly to balance your clients’ books and calculate their yearly tax returns. You already have a lot of paperwork to deal with – which is why invoicing your client should be the least of your concerns. Fortunately, with innovative invoicing systems available online, you can now automate your entire invoicing so that you will get compensated for the work that you put into your craft. By creating an accounting invoice, you can guarantee that you will be paid on time. Creating one is simple, and you even have three options to do it!
What is an Accounting Invoice Used for?
An accounting invoice, like most invoices, is used to bill clients for the job that you provided to them – in this case, accounting services. This type of invoice is used by accountants, bookkeepers, and accounting clerks. It allows these professionals to bill their clients according to the accounting industry’s standard pricing structures. In most cases, accountants charge their clients by using these three pricing structures:
- Hourly rate: The most common pricing structure, hourly rate is exactly what it sounds like – you get paid a rate for each hour you spend working. The rate per hour will depend on the accountant’s level of experience and the type of service done.
- Fixed-rate: Ideal for tasks like monthly accounting or bookkeeping work, tax preparation, or payroll tasks.
- Proposal-based payment: In this pricing structure, the accountant will estimate the length that a certain project will take and how much it will cost based on their hourly rate.
An accounting invoice will help professional accountants bill for all of the aforementioned pricing structures. It presents an itemized list of the tasks that they performed and their corresponding fixed fees. If you charge hourly, you can also insert your hourly rate and the number of hours that you’ve rendered for the job. You can then calculate the fee for each task to get the total amount that your client owes you.
Types of Accountants that Benefit from Accounting Invoice
The contract that you sign with your client will determine the kind of accounting invoice that you use. In addition, you may be doing bookkeeping duties or one-off accounting services for your client. It may be a one-time thing or an ongoing contract.
Doing so will make the entire invoicing process smoother and more efficient. At the same time, it also eliminates any confusion with the client, helping you get paid faster. With that said, here are some of the most common types of accounting invoices that you should know.
- Standard Accounting Invoice: The most common option, a standard accounting invoice, can be used for all types of pricing structures and accounting-related projects.
- Automatic Invoice: If you’re billing your clients a fixed rate every billing cycle, this invoice is the option for you.
- Pro Forma Invoice: This invoice can also be referred to as an ‘estimate invoice.’ You will send this type of invoice if you estimate the potential costs even before the project commences. It’s more of an appraisal rather than a bill.
- Credit Invoice: This type of invoice is used to issue a discount or refund. You can use a credit invoice to correct an error or resolve a billing issue.
- Debit Invoice: Used to charge for extra work. At the same time, you may have already sent a standard accounting invoice; however, you had to insert some additional hours. For this matter, you can issue a debit invoice to account for the work and update the total balance that your client owes you.
- Prepaying Invoice: This type of invoice is commonly used to charge a deposit for your client or retain present and future work.
- Mixed Invoice: Can be used to both issue a discount or refund and bill for work simultaneously.
Why Accountants Should Send Professional Invoices
As an accountant, you are very proficient when it comes to numbers. You can use that skill to manage financial matters for individual clients or balance books for businesses. Most of the time, you’ve got your work cut out for you with the number of accounting duties you need to fulfill. Therefore, you need a flexible invoice that will cover all of the expertise and professional service that you provide.
At the same time, it should ensure that your charges are transparent according to any applicable federal and state laws, including your professional organization. A thorough and well-designed accounting invoice will reflect your brand, expertise, and reputation. It will create a level of confidence and trust among your clients in your skills as a licensed accountant.
What Should Be Included in An Invoice for Accountants?
Accountants work hard for their clients. That’s why it’s only right that you get paid for all the effort and commitment that you provide for your work. Follow these quick steps to ensure that your invoice is 100% accurate, legit, and professional. Use this as a checklist to make sure you won’t leave any detail behind.
- Look online for a wide selection of accounting invoice templates available online. They come in different colors, styles, and designs that you can choose from. Then, please select the one you like to start editing your preferred word processing application (Word, Excel, PDF, Google Docs, and Sheets).
- Download the invoice template. If you want to start from scratch and make your invoice more personal, you can look for a template online and copy it on your preferred word processing application.
- Add your accounting brand business name and contact details. If you offer specialized services (e.g., tax accounting), make sure you mention it in the invoice.
- Insert your accounting business logo if you have one. Add your website and your professional designations.
- Add your client’s name and contact details.
- Insert a unique invoice number for documentation and recording later.
- Include the date when the invoice was created, the payment period that the invoice will cover, and the payment due date
Additional Details Include
- Create an itemized list of the accounting services you provided. In addition, add short descriptions and the corresponding charges for each item (hourly or fixed-rate).
- Are you including a discount or promo? Make sure you mention that by adding a line that explains it. That way, your client will know that they are paying a discounted fee for your accounting service.
- Calculate the total amount. After that, include applicable taxes and enter the total at the bottom of the invoice.
- Mention your payment terms, as well as the payment options you accept.
- Add a personal note at the very bottom of your invoice. Use this space to give your client a short thank you message for trusting your services in dealing with their financial affairs.
- Save the invoice and send it to your client. You can customize your invoice to include all the details for each of your clients later on.
When is the Right Time to Send an Invoice as an Accountant?
The right time to send an invoice will depend on the type of accounting service you provide. If you are computing for your client’s tax return or any other annual service, you will most likely invoice your client after completing the task.
Suppose you provide an all-year-round accounting service, as the monthly bookkeeping duties or managing a company payroll. In that case, it’s essential to send your invoice every month or at the agreed-upon time period. That way, you can keep your revenue flowing.
Whatever payment option you choose, make sure that it’s convenient and noted on your invoice. In other words, clarify which portion of the final cost is paid and which needs to be settled.
Every profession needs its corresponding invoice to make sure they get paid. For accountants, look no further than creating a reliable accountant invoice. Follow each of the steps outlined above to make sure you create an accurate, attractive, and professional-looking invoice, or just create an account with ReliaBills for free.